The murder of indigenous environmental activist Berta Cáceres, which took place almost 10 years ago in Honduras, appears to be the result of an organized criminal operation, in which funds from the Dutch Development Bank FMO were misappropriated to finance illegal activities. This is the conclusion of the investigation report published today by the independent commission set up by the Inter-American Commission on Human Rights, the Honduran state, and the relatives of Berta Cáceres.

For years, FMO was a major financier of the Agua Zarca project. Berta Cáceres, an indigenous leader, fought against this controversial dam and was murdered for that reason in March 2016.

FMO financing channelled

The investigators show that the redirection of FMO financing for illegal practices was possible because the Dutch Development Bank did not effectively implement rules to prevent fraud and money laundering. For example, FMO's client DESA did not comply with a number of contractual obligations under the loan agreement with FMO and the other banks. The report concludes that 67% of FMO's financing was channeled to accounts to finance illegal practices. This financed illegal surveillance and intelligence operations, armed raids, and ultimately the murder of Berta Cáceres.

It is striking that FMO, despite its crucial role in financing the Agua Zarca project, did not respond to the commission's request to share further information about the case. Wout Albers, lawyer at Global Justice Association: “The GIEI's findings show that, despite the convictions of a number of individuals, the Berta Cáceres case is far from resolved and that the key to identifying the possible intellectual perpetrators lies with the criminal network of companies and bankers behind DESA.”

Report: Monitoring insufficient

The report is also critical of the actions of Monkey Forest Consulting, which investigated the extent to which DESA complied with FMO regulations. Anne de Jonghe, senior policy advisor at environmental and human rights organization Both ENDS: "Despite the problematic role that MFC played in the Agua Zarca project, FMO continued to work with Monkey Forest Consulting until very recently. It is striking that this agency also plays a role in the assessment of the controversial Manila Bay project, which, despite its negative impact on people and the environment, was ultimately insured by the Dutch public export credit insurer Atradius DSB. This underlines that Dutch public financiers have great difficulty thoroughly checking the reality behind their decisions. As a result, the risks of fraud, corruption, and human rights violations are systematically underestimated.”

Painful shortcomings

The detailed insights into financing structures and control mechanisms in the report point to painful shortcomings in the way in which the Dutch trade and investment instruments supervise clients and hired consultants. Another recent report concluded that the aforementioned Dutch export credit insurer Atradius DSB often does not have to comply with laws to prevent terrorist financing and money laundering. Anne de Jonghe: “Through these instruments, the Netherlands not only runs the risk of being complicit in human rights violations, but also contributes to undermining anti-fraud and anti-money laundering regulations for the benefit of criminal networks.”

The way forward

The report points a clear way forward for justice after the murder of Berta Cáceres: reparations to a fund for the victims by all parties involved, including FMO, and full transparency about what happened. In addition, the Dutch trade and investment instruments have a major task ahead of them. At a time when trade interests are prioritized, it is crucial that human rights are not overlooked and that fraud is prevented. “Dutch public institutions often invest in countries that are vulnerable to corruption and fraud,” says Anne de Jonghe. “Such investments carry demonstrable risks of human rights violations. This report underscores that it is time for FMO, Atradius DSB, and other public instruments such as Invest International to acknowledge the lessons learned from this report.”